Expansion Includes New, Patented Bonding
Technology That Will Be Licensed Across Automotive Industry.
State Incentive Package Helped Secure Expansion
NEW YORK–Alcoa (NYSE:AA) today announced it will expand its Davenport, Iowa
rolled products plant to meet rising demand from the automotive market.
More and more automotive original equipment manufacturers (OEMs) are
switching from steel to aluminum products from Alcoa as they seek to
increase the fuel efficiency, safety, durability and performance of the
cars they produce.
The expansion, which will entail an investment of approximately $300
million, will take the world’s foremost aerospace materials facility —
known across the globe for its 220-inch wide mill, the largest in the
world – and will create an additional pillar of world-class production
dedicated to the automotive market. The growth project will create an
additional 150 full time jobs in Davenport once completed, bringing
total employment to more than 2,300 high-value jobs. In addition, during
construction, an incremental 150 jobs will be created at the plant. The
expansion is expected to be completed by the end of 2013.
“The automotive market is a tremendous growth opportunity for Alcoa over
the next several years,” said Klaus Kleinfeld, Alcoa Chairman and Chief
Executive Officer. “Our leading-edge technology solutions and our
world-class manufacturing capabilities, combined with our dedicated and
highly-engaged workforce, put us in an enviable position in the market
and bodes well for future growth.
“Consumers want cars that are more fuel efficient and deliver the same,
if not better, performance as they are accustomed to today,” said Helmut
Wieser, Alcoa Executive Vice President and Group President of Alcoa
Global Rolled Products. “Practically every OEM in the world has come to
us to discuss how our leading technology solutions can help them make
their cars stronger, lighter and more fuel efficient.
“The automotive market has long lead times and much of this expansion we
are announcing today is for business already secured. However, we see
huge opportunity beyond this for our leading technology solutions in
this market, including our patented Alcoa 951 technology, which we
expect to license throughout the industry,” said Wieser.
Alcoa 951 is used to improve adhesive bonding for vehicle assemblies.
The product has been proven to be incrementally superior in performance
to other products available in the automotive industry. The process is
used as a pretreatment for aluminum alloy sheet, extrusions and castings
to improve bonding performance. In customer trials, tests have shown it
as being four to nine times stronger than titanium zirconium
applications used in the automotive industry.
A study of automakers by Ducker Worldwide, released earlier this month,
showed automakers will increase their use of aluminum from 327 pounds in
2009 to 550 pounds in 2025. For 2012 model cars, the use of aluminum has
reached an all-time high of 343 pounds per vehicle, a five percent
increase. According to OEMs surveyed in the study, aluminum use as a
percent of the overall automotive materials mix is expected to double by
2025 to 16 percent
An economic development incentive package from the Iowa Department of
Economic Development (IDED) helped secure the selection of Davenport for
the expansion. The incentive package includes tax, financing and R&D
credits as well as training grants for the Davenport workforce and new
“Alcoa has been a great Iowa partner, and we are excited to see this
expansion in Bettendorf,” said Iowa Gov. Terry Branstad. “Their
commitment to creating jobs in our state is appreciated, and coincides
with my administration’s commitment to economic growth in Iowa.”
Alcoa Davenport Works, which earlier this year hosted President Obama,
produces aluminum sheet and plate for a variety of industries. Materials
produced at the plant are used in aerospace and defense, passenger
vehicles (cars and light trucks), commercial truck and rail
transportation and the industrial market. Davenport Works opened in 1948
and is one of the largest aluminum fabricating facilities in the world.
The plant has more than 130 acres under roof and generates nearly $1
million a day into the local economy.
Alcoa is the world’s leading producer of primary and fabricated
aluminum, as well as the world’s largest miner of bauxite and refiner of
alumina. In addition to inventing the modern-day aluminum industry,
Alcoa innovation has been behind major milestones in the aerospace,
automotive, packaging, building and construction, commercial
transportation, consumer electronics and industrial markets over the
past 120 years. Among the solutions Alcoa markets are flat-rolled
products, hard alloy extrusions, and forgings, as well as Alcoa® wheels,
fastening systems, precision and investment castings, and building
systems in addition to its expertise in other light metals such as
titanium and nickel-based super alloys. Sustainability is an integral
part of Alcoa’s operating practices and the product design and
engineering it provides to customers. Alcoa has been a member of the Dow
Jones Sustainability Index for nine consecutive years and approximately
75 percent of all of the aluminum ever produced since 1888 is still in
active use today. Alcoa employs approximately 59,000 people in 31
countries across the world. More information can be found at www.alcoa.com.